Navigant Research Blog

A quick glance at the US Department of Energy’s wind speed maps is enough to see that, in the US, wind energy is mostly where the people aren’t. The population megalopolises of the east and west coasts are thousands of miles away from the central states with high wind energy, challenging traditional high voltage alternating current (HVAC) transmission networks to overcome expensive and high loss transmission issues. Internationally, the same problem exists: How do developers make the most of untapped remote renewable resources?

Can the Solution Be HVDC?

High voltage direct current (HVDC) is a high capacity, long-distance transmission system with low losses. More expensive to build than HVAC power lines, an HVDC network becomes more cost-effective in the long run for distances of 400 miles or more on land and just 30 miles underwater. HVDC lines of 800 kV or more are commonly referred to as UHVDC (ultra-HVDC) As in the US, much of the world’s most valuable renewable resources are remotely located, and require long-distance transmission.

Delivering Energy with HVDC

(Source: Clean Line Energy Partners)

According to Navigant Research’s report Transmission System Upgrades for Renewable Energy Integration, global HVDC revenue is expected to grow at a compound annual growth rate of 9.5% from 2016 to 2025 and reach $12.7 billion by 2025. It focuses on HVDC’s application to renewables integration; the revenue figures do not account for HVDC installations for non-renewables transmission. The report also includes an in-depth analysis of the drivers, barriers, costs, and benefits of a HVDC system, a few of which are listed below.

HVDC systems can do the following:

Connect distances of more than 2,000 miles

Transmit up to 3 times more power than AC systems of equivalent voltage in a similar right-of-way

Transmit the same amount of power as an AC network in significantly smaller right-of-way

Interconnect grids over land and under sea

Provide grid operators with greater control over power flow with minimal losses

If HVDC Networks Are So Great, Why Aren’t They Everywhere?

Despite the benefits of HVDC, financial and regulatory barriers limit the construction of new HVDC networks. Current restrictions on right-of-way permitting and heavily controlled costs have suppressed penetration of HDVC systems, but that may change now that there are several significant projects underway. A few of the most significant upcoming projects are the following:

India-North-East Agra: The world’s first multiterminal UHVDC transmission link. The 800 kV, 1,073-mile link will supply enough power to serve 90 million people. Scheduled for completion in 2019.

United Kingdom-Western HVDC Link: The world’s first 600 kV or higher subsea HVDC network, with 239 of 262 total miles underwater. It is scheduled for completion in 2018.

Iceland-UK IceLink: This early-stage project will transmit power between Iceland and the UK. It will be 620-745 miles long, and will operate at 800 kV-1,100 kV. Estimated completion is 2027, and it will supply power to serve approximately 1.6 million homes.

Latest in HDVC

In early November 2017, the world’s first ­1,100 kV UHVDC transformer passed its type test, confirming the design criteria and operating parameters of the unit. Designed and built collaboratively by ABB and Siemens, the transformer will be commissioned in 2018 for installation as part of the Changji-Guquan link. Spanning 2,040 miles (3,284 km), the link will set world records for voltage, transmission capacity, and distance.

Looking Forward

Despite the high capital costs of HVDC, the benefits are clear, both for renewables and fossil fuel generation. The long-distance, high capacity systems can bring power to areas in need, deliver power from offshore wind farms to mainland cities, and reduce the environmental impact of transmission networks with smaller footprints. The commissioning of the Changji-Guquan link is a major step toward future intercontinental, long-distance, underwater, and over-land HVDC transmission systems, and it won’t be the last.

A common misconception around the rise of distributed energy resources (DER) and the Energy Cloud is that investment and innovation in the power sector is focused almost exclusively across the grid edge. While the grid’s center of gravity is shifting downstream, utility-scale generation and bulk transmission remain a key buttress for the grid in the midst of a historic transformation.

The global high voltage transmission network connecting centralized generation sources to the distribution grid is estimated to stretch across 3.5 million km. To put this in context, there is enough high voltage infrastructure deployed globally to wrap around the earth 75 times. Although already extensive, the International Energy Agency (IEA) estimates that an additional $7.2 trillion investment is needed for transmission and distribution (T&D) grids through 2030—40% of which is just to replace existing infrastructure.

High voltage direct current (HVDC) transmission lines, which function as arteries that move large amounts of electricity above and separate from the existing alternating current (AC) grid, are a key focus of this investment. Currently, there is more than 200 GW of HVDC capacity deployed globally.

According to Navigant Research’s Supergrids report, global investment in HVDC infrastructure is expected to increase from $8.3 billion annually in 2016 to $10.2 billion by the end of 2025. An estimated 65 supergrid projects heavily leveraging HVDC are in development or planned around the world. One such project, dubbed the Asia Super Grid, was born out of a memorandum of understanding among Japan, China, South Korea, and Russia in 2011.

Why So Much Fuss Over Expensive Hardware?

Since large-scale renewable energy projects tend to be built in remote areas where resource anomalies exist (such as wind in remote plains, solar in desert regions with high insolation, and geothermal power tapping underground steam located near centers of volcanic activity), bulk transmission is necessary to deliver generated electricity to large population centers, sometimes located thousands of miles away. The largest pools of renewable energy tend to be the farthest from human population centers; supergrids connect these areas of high supply to areas of high demand.

As discussed in the Navigating the Energy Transformation white paper, the emergence of the Energy Cloud will mean an expansion of traditional grid boundaries to integrate local networks of DER—microgrids, virtual power plants (VPPs), and others—as well as expand internationally to tap far-flung pools of renewable resources.

The Expansion of Traditional Grid Boundaries in the Energy Cloud

Source: Navigant Research

China is currently the world leader in the development and deployment of HVDC infrastructure. This is partly out of necessity; not only is China playing catchup with domestic demand for electricity, but the majority of its population of 1.3 billion lives in the east of the country, 2,000 km or more from its most concentrated energy resources. According to an Economist analysis, three-quarters of China’s coal is in the far north and northwest of the country, for example. Meanwhile, four-fifths of its hydroelectric power is in the southwest.

China’s state-owned utility, State Grid, is halfway through its 10-year plan to spend $88 billion on HVDC lines between 2009 and 2020. As investments continue, we expect the prospect of a global grid to come more sharply into focus—though obstacles related to cost, standards harmonization, consensus around rules of free trade of electricity, and geopolitical hurdles will first need to be more firmly settled.

Many of us here in the United States have little appreciation for the tremendous size and opportunity for electric transmission and distribution system technologies in the Asia Pacific region. To use Geoffrey Moore’s analogies regarding how technology markets develop, there are the 500-pound gorillas, two or three followers, and a number of other wannabes.

Taking that metaphor to the regional market level, the Asia Pacific market has two significant gorilla countries, India and China, some followers like Japan, Australia, and Indonesia, and then the other wannabe countries. Electric transmission technology vendors have an opportunity-rich environment across the region, but the sheer scale of the opportunities and the sophisticated plans in India and China present the biggest gorillas. To illustrate this point, I’ll focus on India, where the national transmission planning process is most transparent.

The 1.2 Billion

India currently has a population of 1,264,360,000 people, representing 17.5% of the world’s population, or 386 people per km2, of which only an estimated 30% have electricity. The country’s landmass is approximately 3,287,263.00 km2, which is about half the size of the United States. India currently has over 220 gigawatts (GW) of generation capacity, a number that is expected to grow to 425 GW in 2022, with the addition of up to 66,000 kilometers of transmission lines and 90 new substations. Most of the current electric transmission system in India is in the 135 kilovolt (kV) to 450 kV range, and it has significant reliability issues due to weather, introduction of intermittent renewables, and aging infrastructure.

The fascinating point here is that Power Grid India, the national transmission system operator, is now building out a high-voltage transmission superhighway that will serve as the backbone for India’s rapidly expanding transmission and distribution grid. This plan is exceptional because of the use of extra-high-voltage 800 kV high-voltage direct current (HVDC) and 765 kV high-voltage alternating current (HVAC) systems – on a scale seen nowhere on the globe except in China. The following graphic shows the overall configuration.

Planned HVTSs under Implementation, India

(Source: Power Grid Corp. of India Ltd.)

The Way Forward

Adding to the tremendous scale, India is specifying and using the latest technologies, including state-of-the-art flexible AC transmission system (FACTS) devices such as static VAR compensators (SVCs) and static synchronous compensator (STATCOMs) that are still controversial in some regions in North America, such as PJM, as well as synchrophasor and wide area situational awareness (SWASA) technologies and solutions to better manage the transmission grid in real-time. These technologies and markets are discussed in a series of Navigant Research reports from 2014, including Flexible AC Transmission Systems and High Voltage Transmission Systems.

India recently deployed over 1,300 phasor measurement units (PMUs), giving the country one of the largest current PMU deployments in the world, showing leadership in advancing these new and powerful technologies.

For the big three electric transmission technology companies, ABB, GE/Alstom, and Siemens, as well as the other technology companies like Schneider, S&C, Mitsubishi, Toshiba, and other new entrants, the rapid expansion of India’s transmission system represents a tremendous revenue opportunity. For the population of India, it represents electrification on a large scale a much more reliable and resilient power grid – and a path to a much higher standard of living.

One of the most ambitious high-voltage transmission system and utility-scale energy storage projects in history is happening in the American West. Designed by Duke American Transmission in a partnership with Pathfinder Renewable Wind Energy, Magnum Energy, and Dresser-Rand, the massive plan was recently announced. As I have discussed in a previous blog, the utility-scale wind generation projects in progress across the High Plains and the Midwest are epic, to say the least. Transporting this energy to major population centers such as Los Angeles represents major challenges and huge transmission system investments. The intermittency of the wind resource needs to be managed, as well. That is why this proposal represents some very creative thinking and engineering.

Driving cross-country from San Francisco to Northern Wisconsin on I-80, I began to better understand the massive geographical challenges that transmission utility planners and operators face. The idea of moving twice the power that the Hoover Dam in Nevada produces from Chugwater, outside of Cheyenne, Wyoming, to Southern California includes building high-voltage direct current (HVDC) transmission lines across mountain passes up to 11,000 feet in Wyoming, and slightly lower passes in Nevada and California. These lines will take years to fund and build, creating significant opportunities for major suppliers like ABB, which recently announced new 1,100 kV HVDC transmission system capabilities.

Salt Storage

The other really striking part of this announcement is the grid-scale storage project, which proposes to excavate salt caverns in central Utah and use them to store the wind energy as huge volumes of compressed air, serving as a massive battery, larger than any storage system ever built. Compressed air would be pumped into these caverns at night, when wind power generation is peaking, and discharged during the day during periods of higher demand.

The proposal is currently going through what may be endless approval processes at the state and federal levels, but a decision could come as soon as 2015. In many ways, this new and novel proposal reminds me of the Pacific Gas and Electric (PG&E) Helms pumped storage solution that has been operating since 1984, storing Diablo Canyon’s nuclear output at night by pumping water up into a lake and then discharging it through turbines for peak generation. The Duke project could be an epic feat of American power engineering to rival Hoover Dam itself.